Australian Inflation Data Surprise, AUD/USD Plunge!

<p>&nbsp;The Australian dollar reacted to some data published in early trading this week and can be seen on the price chart.</p><p><br /></p><p>On Tuesday yesterday, there was a momentary jump in the value of the Australian dollar after being affected by the actions of the People's Bank of China (PBOC) which pegged the Yuan at a higher level than expected.</p><p><br /></p><p>However, it was a different story in the Asian session this morning (Wednesday) when the focus was on the release of Australia's consumer price index (CPI) data for May.</p><p><br /></p><p>Australia's annual inflation reading came in lower at 5.6% compared to the previous month's 6.8%, when forecasts were for it to fall to 6.1%.</p><p><br /></p><p>This is Australia's lowest inflation since April 2022 and this decline is seen as making it more difficult for the central bank to continue further monetary policy tightening.</p><p><br /></p><p>If you look at the chart of the AUD/USD currency pair, there has been a decline to the latest 3-week low.</p><p><br /></p><p>On Tuesday yesterday, the price surged to the 0.67200 level triggering expectations of a change in direction as the price began to move above the Moving Average 50 (MA50) support level on the 1-hour time frame of the chart.</p><p><br /></p><p>However, prices retreated again until yesterday's New York session before a significant decline was exhibited in the Asian session this morning due to the reaction to the published CPI data.</p><p><br /></p><p><br /></p><p>Returning to move below the MA50 level again, seeing the price resume the bearish trend movement like last week.</p><p><br /></p><p>The price has dropped to around 0.66200 before the price movement started to slow towards the opening of the European session market.</p><p><br /></p><p>A lower decline is expected to continue with a target towards the RBS (resistance become support) zone of 0.65400.</p><p><br /></p><p>If the decline continues, the price will reach the support zone last May around 0.64600.</p><p><br /></p><p>In the event of a price surge again, the 0.67000 level is seen as an important zone to be tested before the trend change signal is evaluated with the MA50 level to be tested.</p><p><br /></p><p>A higher increase if it continues above the level reached yesterday can lead up to the concentration zone of 0.67600.</p>